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Guaranteed Rent

What is a guaranteed rent scheme?

Under a guaranteed rent scheme, also known as a rent-to-rent scheme, a landlord signs over their rental property to a company, institution, letting agent, or individual for a specified period of time in exchange for a guaranteed monthly income (regardless of whether or not the property is occupied or if the tenants are in arrears).

The individual or organisation renting the property from the landlord then sublets the property to tenants and manages the property and tenancy. The renters who occupy the property have no direct relationship with the landlord, and everything is handled by the middle tenant.

How do these schemes work?

In a rent-to-rent arrangement, the middle tenant signs a contract guaranteeing to pay a set monthly income to the landlords in return for taking full control of the property and its management. The middle tenant will market the property to find renters, do all of the tenancy administration, handle any property maintenance  (excluding those that are the landlords responsibilities as per section 11. Landlord and tenant ACT 1985), ensure that the property is compliant with all relevant legal requirements, and take care of legal proceedings in the event that the renters living in the property need to be evicted.

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